Several years ago I worked with a CPA who wanted 20 new clients. We came up with a great direct marketing campaign that brought in 10 leads per 1,000 letters. His closing rate was 10%, so after his first few clients came on board, we calculated that acquiring new clients was costing him between $500 and $600. He liked the numbers (one client was worth about $8,000/year), but progress was slow. We advised him to open the spigot and mail 5,000 at a time, instead of the 1,000 he was sending. It worked, and he acquired the new clients he was looking for sooner rather than later.
I do quite a bit of public speaking on direct marketing. One question I like to ask my audience is "How large is your database?" I get answers anywhere from 100 to 250,000. I worry about companies who don't have at least 2,500 names in their databases. Unless they're selling high six-figure products or services or have a closing rate near 100%, they don't have enough prospects to meet their numbers.
Database marketing is all about up-selling and cross-selling your existing customers and targeting prospects to find qualified buyers who are ready to buy now. It's a numbers game. The more you put into the funnel, the more orders that come out at the other end. Here's the formula for calculating how many leads you'll need this year:
Annual projected sales / average order size / sales close percentage rate.
Let's say your annual sales quota is $750,000. An average order is $1,000. You're a pretty good sales person so let's say your closing rate is 40%. Using the formula above ($750,000 / $500 / 40%), you'll need 3,750 new leads, or 313 new leads per month. If you're relying on traditional prospecting like shoe leather (networking, clipping "prospects" from the paper, telemarketing), you're not going to get "there" in time! The fastest way to build a client base is to build a database of qualified prospects. Consider these shortcuts:
1. Buy a targeted prospect mailing list. Review your top 20 customers and figure out the demographics that make them ideal customers for your business. Then buy lists of these prospects. There are 40,000 different prospect lists on the market; you'll need to find the best 3 to 4 that fit your "profile." You may find it faster and cheaper to have a mailing list broker help you find these needles in the haystack.
2. Capture targeted leads off the Internet. Rather than cut and paste, you can use data capture software to compile your own chamber lists, membership lists, yellow pages listings, and email signatures in an Excel-spreadsheet-like format, which can then be downloaded into ACT! or any database.
3. HP, the printer company, did a study that showed 80% of a buyer's sales decision is made by the time he calls you. Consequently, your goal is to make prospects call you. With enough prospects, you can start a drip-marketing campaign to educate and qualify them. Use direct mail letters and postcards to drive prospects to your website, where you can then capture their opt-in email addresses to start email marketing campaigns.
Do the math! Start building and marketing to your prospect database now, and you'll meet your numbers by year-end.
Lori Feldman is president of Aviva, a mailing list and database marketing and Internet consulting firm and an ACT! Software Certified Consultant. She is this year's Direct Marketer of the Year, awarded by the Direct Marketing Assn. of St. Louis. Reach her at http://www.aviva-aviva.com/FreeContactMagne t.html
Business owners of long standing know the cardinal rule "take... Read More
I am sure you are familiar with the phrase, "I... Read More
Female mannequins are very common in clothing stores. They are... Read More
Ever feel like you were "just a salesperson"? I think... Read More
Direct sales can be your ticket to a profitable home-based... Read More
If you live in England then you will already be... Read More
I'll play a seller, using conventional selling methods, selling something... Read More
Any time a clothing store opens or expands, they must... Read More
Depending upon how much you enjoy writing, writing sales proposals... Read More
Could this be the worst moment in your selling cycle?You've... Read More
You know that word of mouth can grow your business.... Read More
It is fairly common for real estate companies and mortgage... Read More
Your prospect is in the market for a widget, just... Read More
(Objection handling tips excerpted from Objections! Objections! Objections!)People buy people.... Read More
"If you do anything foolish or try to get out... Read More
Let me create a picture for you. This is the... Read More
Some trainers and sales managers teach that there are prospects... Read More
Just about every clothing store uses mannequins. There are many... Read More
If you are in Sales, you have probably heard these... Read More
Lead Generation is vital to all businesses. All companies try... Read More
Have you ever met with, or talked to a prospect... Read More
Recently I wanted a new lawn mower as we have... Read More
Like the legendary search for the Holy Grail, the cup... Read More
Color psychology is the biggest question I receive on a... Read More
Here are four simple things you can do to take... Read More
"THE ANSWERS (1 - 5) ARE HERE!!!"Question 1) List the... Read More
We all know that you can't earn your commission until... Read More
The other day, I received the last issue of a... Read More
There's a direct correlation between sales experience and prejudging. The... Read More
I can remember the first time that I had to... Read More
The best day of the week is TODAY, of course.... Read More
You have just walked out of the office of a... Read More
I've found that winners say "I choose to." Whiners, on... Read More
After our first half-hour telephone coaching session, when asked what... Read More
A few days ago, I was signing copies of my... Read More
Whether you're a conventional sales person, a professional ? such... Read More
Some trainers and sales managers teach that there are prospects... Read More
This issue's topic was suggested by a sales rep for... Read More
Who among us is not already up to here with... Read More
You arrived on time and completed your calculations. You worked... Read More
1. Settle On The Right Way ForwardThe purpose of your... Read More
Cold calling can be a great way to generate quality... Read More
To be more effective at developing relationships, one should always... Read More
The topic of this issue's article is a response to... Read More
Keeping the 80/20 rule in mind; that is that 80%... Read More
Ready to put your Web pages up? Ready to sell... Read More
People ask me, "What should I charge?"I say, "Ask your... Read More
You've met a new prospect, accurately assessed their needs and... Read More
Writing good sales copy is not an art, it is... Read More
I wonder when we decided to become a sales person.... Read More
What comes to mind when you think of networking --... Read More
Sean works for a major telecom company.During one of our... Read More
Do you have 5, 10, or 20 years of sales... Read More
For many of you the Fear of Selling is a... Read More
Selling is not talking. It's listening. You may have heard... Read More
Use Bundling To Increase Your Profits And Sales An effective... Read More
Long-term sales success has less to do with skills or... Read More
* Are you sending e-mails to prospects instead of calling... Read More
Smart buyers will always ask for a better price. Unfortunately,... Read More
I really just don't get it.How can so many businesses... Read More
If Chicken Little were alive today he wouldn't be running... Read More
Speak to almost any self employed professional and most of... Read More
The number one requirement, whether you are a business owner... Read More
Color psychology is the biggest question I receive on a... Read More
There are 3 ways to grow any business:- Get more... Read More
Many pressure washing companies try to stay away from the... Read More
Sales |